Treasury, which rejected a $2.9 billion unsolicited bid from
KKR LLC in April, said the 10.6 percent rise in the offer price
meant it was now "in the interests of shareholders to engage
further."

Asia's growing appetite for wine, the value of Treasury's
Penfolds label and an ongoing restructuring are helping turn
perceptions of the company's prospects around after a horror
2013 saw profits slump 38 percent in the six months to February.

"Absolutely there are (rival bidders), they've now kind of
set a starting point for the price," said Shannon Rivkin,
director at Rivkin Securities. "This is going to be the point
now where anyone who has any interest will be able to have a
look at the books as well."

Treasury, which also owns the Wolfblass and Beringer brands,
stressed it was providing KKR and Rhone with "non-exclusive"
access to its books for due diligence and that there was no
certainty any offer would be forthcoming.

Treasury rejected KKR and Rhone's A$4.70 per share bid as
too low in May after KKR began approaching investors directly.

The new A$5.20 offer is a five percent premium to Treasury's
A$4.95 share price close on Friday.

Treasury's shares have fallen from an all-time high of
A$6.43 a year ago amid slashed earnings forecasts, oversupply
problems in its U.S arm and sluggish sales in China.

If a firm offer did result, Treasury said it would assess
whether it provided superior value to plans the company already
had to cut costs and improve its performance, which included
separating its Australian luxury and mass prestige portfolio
from its lower value commercial brand portfolio.

Rivkin cautioned that a closer look at the books could also
raise concerns - and possibly a lower price - pointing to the
recent takeover of struggling food maker Goodman Fielder Ltd
by Malaysian billionaire Robert Kuok's Wilmar
International Ltd.

Wilmar and Hong Kong investment firm First Pacific convinced
Goodman to accept a lower offer after a look at the books
resulted in the Australasian firm warning of a massive
impairment charge due to pressures on its baking unit.

"I think this is a starting bid, once they have a look
through, if there are any issues there that the market's not
aware of they could still very easily walk away," Rivkin said of
the KKR offer for Treasury.

WINE WOES

Treasury's problems are reflected in the broader Australian
wine industry, which has struggled through volatile market
conditions and a high currency in recent years.

Treasury - which posted sales worth A$1.7 billion in the
2013 financial year - has tried to stave off takeovers by
cutting costs and installing new CEO Michael Clarke in April.

Former CEO David Dearie was sacked in September last year
after presiding over a A$160 million charge due to the
destruction of thousands of gallons of cheap wine exported to
the United States.

An efficiency drive imposed by Clarke is expected to
generate A$35 million in savings in the 2015 financial year by
shedding jobs and rationalising office space, I.T. and
non-essential spending.

The company, which is scheduled to release full-year results
on Aug. 21, is also counting on its Penfolds release to boost
sales in the second half of the 2013-14 financial year.